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Dear Friend
of GATA and Gold:
There's
revolution and war in the Middle East and Africa, devastation and nuclear contamination
in Japan, and turmoil throughout the world financial system, but the
Financial Times always has time to try to make fun of gold and those who see
any virtue in it.
In its Friday
editorial, "In Gold They Trust," the FT finds humor in Utah's potential
experiment with accepting gold and silver as currency, as allowed to states
by the national Constitution. The FT writes:
"Utah is
no stranger to eccentric laws. This is, after all, the state whose citizens
have, at various points, felt the need to outlaw both fishing from horseback
and dispensing gunpowder as a headache cure. Now it has another legislative
feat to match these illustrious forebears. The state's legislature has passed
a bill that paves the way for gold and silver to become legal tender. All
that remains is for Governor Gary Herbert to sign on the dotted line."
Yes, the quaint American West, where
more people earn their livelihoods by creating things than by shifting money
around, and where the newspapers don't exploit their opportunities to
reciprocate the fun with foreigners, as well they might do with a paper from
enlightened London, capital of a country where the courts lately have taken
to issuing injunctions keeping everything secret and prohibiting citizens
from raising grievances with their elected representatives (http://www.telegraph.co.uk/news/uknews/law-and-order/8394566/Hyper-injun...), where the
monarch is prohibited not only from marrying a Catholic but also from
becoming one himself, (http://en.wikipedia.org/wiki/Act_of_Settlement_1701), and where
every square yard ("This royal throne of kings, this sceptred
isle, / This earth of majesty, this seat of Mars, / This other Eden,
demi-paradise, / This fortress built by Nature for herself") now comes
fully equipped with a tax collector and a closed-circuit television camera.
The FT
somehow thinks that gold's ever-higher price is more of a problem for the
metal's monetization than the constant devaluation of government currencies
is for their continuing to serve as money.
Here's
something even funnier than Utah's quaintness, a pretty good joke that seems lost
on the FT -- a chart of gold priced in British pounds over the last decade:
http://www.24hgold.com/english/interactive_chart.aspx?codecom=GOLD&chgec...
The whole of
the FT's oblivious mockery of Utah is below. Let's come back in a year or two
and see who's still laughing. Let's hope that Britain itself, if not the FT,
is even still there to laugh.
CHRIS POWELL,
Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
* * *
In Gold They
Trust
Financial
Times, London
Friday, March 25, 2011
http://www.ft.com/cms/s/0/3b3dee16-5721-11e0-9035-00144feab49a.html
Utah is no
stranger to eccentric laws. This is, after all, the state whose citizens
have, at various points, felt the need to outlaw both fishing from horseback
and dispensing gunpowder as a headache cure. Now it has another legislative
feat to match these illustrious forebears. The state's legislature has passed
a bill that paves the way for gold and silver to become legal tender. All
that remains is for Governor Gary Herbert to sign on the dotted line.
By the
standards of the most fanatical hard-money purists, the plan is quite modest.
Ron Paul, the Republican congressman who is the high priest of currency privatisation, has just reintroduced a bill that would
allow everyone to mint their own coins. Both this and Utah's law are meant as
rebukes to the US Federal Reserve, whose boundless enthusiasm for printing
dollars has not exactly boosted confidence in the greenback. But Utah's
unilateral gold standard has problems of its own.
For one, it
would mean very small coins. Under Utah's law, the value of the coins would
reflect the gold (or silver) price. A troy ounce (roughly 31 grams) of gold
is currently changing hands for more than $1,400. At that price a gold coin
worth a dollar would weigh all of 22 milligrams. That may be great news for
microscope makers but it will be pretty fiddly for anyone hoping to buy a
coffee in Salt Lake City. Of course, bigger coins could be used. But then
even the change for a gunpowder-free headache pill would run to several
suitcases of the worthless greenbacks Utah's goldbugs
so despise.
If the gold
price surged, those coins would have to become smaller still. A fall would
not be much more helpful. Shopkeepers would presumably stop accepting coins
worth less than their face value, bringing the economy to a juddering halt --
unless, that is, Utah's state government stepped in and guaranteed the coin's
nominal value. Which sounds rather similar to the
arrangement critics of the Fed are so upset about.
Chris
Powell
Gold
Anti-Trust Action Committee Inc.
* * *
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